Description:
Federal Realty is a real estate investment trust that develops, owns and runs retail properties along the East Coast and in Chicago and Southern California. It has traditionally focused on neighborhood and community strip shopping centers. Over the past two years, it has begun to develop what it calls "Main Street" retail centers—street-level stores in traditional small-city or suburban downtowns, such as its Bethesda Row project in downtown Bethesda.

Developments:
In 1996 Federal Realty expanded into Southern California, purchasing a portfolio of 10 Main Street retail properties in Santa Monica, Pasadena and San Diego. As with its other Main Street properties, it plans to renovate most of these street-level stores and find new tenants for them. In December it also purchased a shopping center in Escondido and last month it bought a shopping center in San Jose.
Locally the company completed the first phase of the redevelopment of its Bethesda Row property, opening a Barnes & Noble bookstore and 14,000 additional square feet of retail space there.

Federal Realty also continued to buy the East Coast strip shopping centers that for years have been the backbone of its holdings, including centers in the Philadelphia and Boston suburbs. Overall, the company acquired 850,000 square feet of retail property during 1996, spending $106 million.

To pay for its acquisition and redevelopment programs, Federal Realty raised $132 million during the year in a public debt offering and public and private stock offerings.

As with other real estate investment trusts, investors and analysts usually evaluate Federal Realty's financial results not by net income but by funds from operations, a measure that takes into account such real estate-related items as depreciation and amortization. In 1996 funds from operations rose to $1.94 per share, from $1.79 per share in 1995, an 8 percent increase.